Japan's exports plunge by a quarter

Japanese exports plunged a record 26.7% in November, the Ministry of Finance said today.

Economists warned that exports – a mainstay of the world’s second-largest economy – would tumble further with no recovery in sight for the global economy.

Global consumer demand for cars, electronics parts and other Japanese products have been hit during the downturn.

“Demand is rapidly cooling not only in the United States and Europe but also in Russia and the Middle East, and we are expecting a further plunge in exports as the global economy is deteriorating,” said Hideki Matsumura, a senior economist at the Japan Research Institute in Tokyo.

Battered by falling sales and a strengthening yen, major exporters like Toyota and Sony have already announced job cuts and lower profit projections.

Exports suffered their biggest year-on-year drop since the current system of statistics went into effect in 1980. Exports totalled 5.3 trillion yen (€42bn) while imports fell 14.4% from a year earlier to 5.55 trillion yen (€43bn), the ministry said.

That resulted in a trade deficit of 223.4 billion yen (€1.7bn) – the fourth time this year Japan said its imports exceeded exports after January, August and October.

For years, Japan was blasted by its trading partners over its trade surpluses. But now, the global economic slump is turning Japan into a net importer, at least in recent months.

Exports to the United States, the world’s largest economy, plummeted by a record 33.8% in November, marking the 15th consecutive year-on-year fall.

Among US-bound shipments, vehicle exports plummeted by 44% in the month, while exports of car parts fell 40% and those of audio equipment was down by 48.2%.

Japan’s exports to the European Union tumbled by 30.8%, with vehicle shipments to the region falling by 37.2%, the ministry said.